New Anti-Kickback Safe Harbor Allows Free Transportation Services

There are many benefits laboratories can’t provide to beneficiaries or referral sources without running afoul of the Anti-Kickback Statute. New changes to safe harbor regulations, however, allow labs to provide free transportation to Medicare beneficiaries under certain circumstances.

The new transportation safe harbor allows labs and other providers to offer free or discounted local transportation services to federal program beneficiaries.  Under this safe harbor, transportation programs may offer: a) transportation to and from a patient’s home to provide access for that patient to a provider or supplier; or b) vouchers for such transportation provided by another entity.

Some limitations apply to free or discounted transportation:

• Transportation can’t be luxury, air or ambulance-level service.
• The transportation can’t be advertised or used as a marketing tool.
• Transportation policies can’t be influenced by past or anticipated volume or value of federal program business.
• Health care services or items can’t be advertised or marketed during the transportation or at any time by drivers.
• Drivers or others involved in arranging the transportation can’t be compensated based on “per-beneficiary-transported basis.”
• Only established patients can be provided free transportation services.
• If one provider is offering free or discounted transport to another provider, the patient must be an established patient of both the transporting and receiving provider.
• Transportation must be for the purpose of accessing medically necessary items and services.
• The entity making the transport possible bears the cost of the transport and can’t shift the cost to federal programs, other payers or individuals.
• Distance for transportation is limited to 25 miles from the provider in urban areas and 50 miles from the provider in rural areas (Distance is measured “as the crow flies”—i.e., it includes any destination within the 25-mile radius of the provider).
• Suppliers of items are not eligible to provide such transportation benefits.
• If a hospital transports a patient to a laboratory (or other specialty provider), the patient must be able to choose the lab and the hospital can’t condition the transport on the patient selecting a lab in the hospital’s network.
• Policies must be implemented to ensure the provider consistently and uniformly administers the transportation program.

Note that the rule requires free transportation only be offered to “established patients.” The final rule explains, however, that established patients can include new patients who have contacted the provider to schedule an appointment. The eligibility trigger is that an initial appointment has been made. The key is that the patient has already chosen the provider, minimizing risk that free transportation service will influence provider selection. Thus, the patient needn’t have received health care services from the offering provider to be considered an established patient eligible for free transportation.

Finally, the safe harbor also allows eligible providers to offer shuttle services subject to most of the same criteria except that the shuttle must run on a set schedule and set route and shuttle schedules and stops can be posted without violating the no-marketing rule. Shuttles also aren’t limited to providing access to medically necessary health care services or to transporting only established patients.